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The CEO’s Blog — Garo H. ArmenWhy I believe in AntigenicsI have spent much of the past six months traveling to Russia and Europe meeting with key opinion leaders in the fields of oncology and urology; working on the details of a potential launch of Oncophage in Russia; and seeking to raise funds to support these operations. Last week we announced that Antigenics raised $26.1 million through a private placement of common stock and warrants. I am particularly gratified that our investors represent a sophisticated group of institutions with substantial expertise in health care. I have received a number of questions as to why I decided to invest $5.1 million, and the simple answer is: my belief and confidence in the company. During my travels, I was heartened by the enthusiasm of the doctors we met and the discussions surrounding the Phase 3 data on Oncophage in kidney cancer. It was very impressive to witness the stature of the physicians attending these advisory sessions and their level of preparedness. Their expression and support of the need to make Oncophage available to patients is the principal impetus behind our efforts in Russia and Europe. I am hopeful that Russia may be the first country where Oncophage could receive regulatory approval. The Russian health care market is evolving and growing at an unprecedented pace; the oncology drug market alone has grown nearly five-fold in two years. This growth has come about mostly because of the availability of government funds to reimburse for expensive drugs. The world is indeed becoming flatter in many ways. The level of sophistication in countries that were not even serious contenders 10 years ago is such that the US can no longer be comforted with its monopoly in cutting-edge fields. Regulatory barriers have become a substantial hindrance in our home market. In my opinion, the FDA is not to be blamed for this, as there are many constituencies pushing the agency in so many directions that a solution to the issues at hand is unlikely to come any time soon. Although there are obvious challenges in the US market, the vaccine industry is rapidly reaching a very exciting growth phase, and Antigenics is leveraging its options based on the various products and technology platforms at our disposal. This means exploring registration of Oncophage in markets like Russia and Europe based on advice from substantial numbers of key opinion-makers and leaders. We are hopeful that the Russian approval will come soon and that we will also identify pathways for filing under conditional approval policies that exist in Europe and Canada. I am also enthusiastic about the potential for future royalty income from QS-21, which is currently being investigated in 16 clinical-stage products for infectious diseases, Alzheimer’s disease and cancer. Our licensees of QS-21 include GlaxoSmithKline, Élan and Acambis, and we could see the first product using QS-21 come to market within the next two years, followed by numerous additional product launches through 2015. Within the company, there is a genuine heartfelt optimism and positive outlook for the company. I look forward to sharing more information on these transforming events throughout 2008.
This communication contains forward-looking statements, including statements regarding (1) potential regulatory approval of Oncophage in Russian and Europe, (2) that, if Oncophage is approved, reimbursement will be available, (3) expected royalties with respect to QS-21, (4) the potential growth of the vaccine industry and the benefits to Antigenics, and (5) the timing for commercial sales of products containing QS-21. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties include, among others, actions and decisions by regulatory agencies, including the Russian Ministry of Public Health and the EMEA, each of which may never approve Oncophage for commercial sale or may only provide such approval after substantial delays; substantial uncertainty with respect to the Russian economic, reimbursement and regulatory systems; and the factors described under Factors That May Impact Future Results in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of Antigenics’ Form 10-Q as filed with the Securities and Exchange Commission on November 14, 2007. Antigenics cautions investors not to place considerable reliance on the forward-looking statements contained in this communication. These statements speak only as of the date of this communication, and Antigenics undertakes no obligation to update or revise the statements.
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